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# Banco de México Cuts Overnight Rate 25 bp to 6.50% and Declares End of Easing Cycle
- URL: https://www.theglobalbanker.com/banco-de-mexico-cuts-rate-25bp-6-50-ends-easing-cycle/
- Published: 2026-05-07T19:30:00.000Z
- Updated: 2026-10-01T23:46:08.000Z
- Description: Banxico's Governing Board lowered the overnight interbank rate to 6.50% in a 3-2 split vote and signalled that the easing cycle begun in March 2024 is now complete.
- Author: TGB Editorial Team
- Tags: Central Banks, Americas

Banco de México lowered its overnight interbank rate by 25 basis points to 6.50% on Thursday, and declared that the cut brings to a close the easing cycle it began in March 2024\. The reduction takes effect on 8 May 2026.

The decision, taken by the Governing Board at its scheduled monetary policy meeting, was carried on a split 3-2 vote. Governor Victoria Rodríguez Ceja and Deputy Governors José Gabriel Cuadra García and Omar Mejía Castelazo voted in favour of the cut. Deputy Governors Galia Borja Gómez and Jonathan Heath dissented, preferring to keep the reference rate unchanged.

#### FIFTEEN CUTS AND A CUMULATIVE 475 BASIS POINTS

Thursday's move is the fifteenth cut delivered by the Board since it began easing in March 2024\. In cumulative terms, the reference rate has been reduced by 475 basis points from a peak of 11.25%, the level at which policy was held from March 2023 until the first cut in March 2024.

The Board said the decision was consistent with its assessment of the current inflation outlook, and that it took into account the observed levels of the exchange rate, the weakness of economic activity, which implies an absence of demand pressures, and the degree of monetary restriction already implemented. Headline inflation fell from 4.63% in the first half of March to 4.45% in April, while core inflation eased from 4.46% to 4.26%, the statement said.

Borja and Heath voted to keep the rate at 6.75%.

#### BOARD SIGNALS HOLD AHEAD

In its accompanying communication, the Board said it considered it appropriate to maintain the reference rate at the new 6.50% level going forward. It judged that the monetary policy stance is adequate to face the challenges of the macroeconomic environment, including those arising from a prolongation and escalation of the conflict in the Middle East.

The Board said the balance of risks to the expected inflation trajectory remains biased to the upside, and it continues to expect headline inflation to converge to the 3% target in the second quarter of 2027.

The decision leaves Mexico's benchmark rate 475 basis points below its cycle peak. 

Banxico's statement set out how each member of the Board voted. The decision ends the easing cycle after 15 cuts.